Read Company acquired 20 percent of the voting shares ILUV statement? e voting shares of Sauk Trail, ies provide commercial Intemet support services bus made the investment to gain access to Sauk Trail's perative agreements between the two firms. Ridge board which gave it the ability to significantly LO 1-6 b. What amouni 15. On January 1, 2017, Ridge Road Company acquired 20 Inc., for $2,700,000 in cash. Both companies provi serve markets in different industries, Ridge Road made the in board of directors and thus facilitate future cooperative a Road quickly obtained several seats on Sauk Trail's board whi influence Sauk Trail's operating and investing activities. The January 1, 2017, carrying amounts and correspon liabilities follow: nounts and corresponding fair values for Sauk Trail's ass LO 1-3,1-4, 1-6 Cash and receivables Computing equipment Patented technology Trademark Liabilities Carrying Amount $ 110,000 5,000,000 100,000 150,000 (185,000) Fair Value $ 110,000 5,700.000 4.000.000 2,000,000 (185.000) LO 1-1, 1-2, Also as of January 1, 2017, Sauk Trail's computing equipment had a seven-year remaining estimated useful life. The patented technology was estimated to have a three-year remaining useful life. The trademark's useful life was considered indefinite. Ridge Road attributed to goodwill any unidentified excess cost. During the next two years, Sauk Trail reported the following net income and dividends: 2017 2018 Net Income $1,800,000 1.985,000 Dividends Declared $150,000 160,000 a. How much of Ridge Road's $2,700,000 payment for Sauk Trail is attributable to goodwill? b. What amount should Ridge Road report for its equity in Sauk Trail's earnings on its incom statements for 2017 and 2018? c. What amount should Ridge Road report for its investment in Sauk Trail on its balance snc the end of 2017 and 2018? 16. An annan 2014 | Read Company acquired 20 percent of the voting shares ILUV statement? e voting shares of Sauk Trail, ies provide commercial Intemet support services bus made the investment to gain access to Sauk Trail's perative agreements between the two firms. Ridge board which gave it the ability to significantly LO 1-6 b. What amouni 15. On January 1, 2017, Ridge Road Company acquired 20 Inc., for $2,700,000 in cash. Both companies provi serve markets in different industries, Ridge Road made the in board of directors and thus facilitate future cooperative a Road quickly obtained several seats on Sauk Trail's board whi influence Sauk Trail's operating and investing activities. The January 1, 2017, carrying amounts and correspon liabilities follow: nounts and corresponding fair values for Sauk Trail's ass LO 1-3,1-4, 1-6 Cash and receivables Computing equipment Patented technology Trademark Liabilities Carrying Amount $ 110,000 5,000,000 100,000 150,000 (185,000) Fair Value $ 110,000 5,700.000 4.000.000 2,000,000 (185.000) LO 1-1, 1-2, Also as of January 1, 2017, Sauk Trail's computing equipment had a seven-year remaining estimated useful life. The patented technology was estimated to have a three-year remaining useful life. The trademark's useful life was considered indefinite. Ridge Road attributed to goodwill any unidentified excess cost. During the next two years, Sauk Trail reported the following net income and dividends: 2017 2018 Net Income $1,800,000 1.985,000 Dividends Declared $150,000 160,000 a. How much of Ridge Road's $2,700,000 payment for Sauk Trail is attributable to goodwill? b. What amount should Ridge Road report for its equity in Sauk Trail's earnings on its incom statements for 2017 and 2018? c. What amount should Ridge Road report for its investment in Sauk Trail on its balance snc the end of 2017 and 2018? 16. An annan 2014 |